Home Money Companies increase prices to faster in 18 months as costs increase

Companies increase prices to faster in 18 months as costs increase

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Inflation: The average prices charged by private employers shot at the fastest rate for 18 months in January, according to S&P global
  • The United Kingdom’s service and manufacturing sectors saw important costs of costs
  • Many companies surveyed cited higher expenses in salaries and energy invoices

The average prices charged by private employers rose to the fastest rate for 18 months in January.

S&P Global said that the United Kingdom’s service and manufacturing sectors experienced high costs, with many surveyed companies that cite higher expenses in salaries, energy invoices and imported raw material prices.

As a result, inflation of input prices accelerated, which led some companies to significantly walk customer prices and make inflation jump to faster rhythm since July 2023.

S&P global also blamed cost pressures for negatively impacting personnel levels for the fourth successive month, since some companies froze new hiring or did not replace voluntary outputs.

Many companies have reduced their recruitment efforts in response to the next increase in national insurance contributions announced in the last October budget.

As of April, employers’ rates will increase from the current rate of 13.8 percent over annual salaries exceeding £ 9,100 to 15 percent of salaries greater than 5,000.

Inflation: The average prices charged by private employers shot at the fastest rate for 18 months in January, according to S&P global

However, the United Kingdom achieved a marginal increase in business activity, partly thanks to the manufacturing industry that contracted much more slowly than in December.

Consequently, the compound output index PMI Flash PMI of S&P Global UK increased slightly to a maximum of three months of 50.9 in January, from 50.4 the previous month.

Any number greater than 50 indicates expansion, while anything under that denotes contraction.

Companies with growing commercial activity benefited from new products launches, as well as successful marketing strategies and attempts to solve the work unfinished.

However, the new general work decreased at faster levels since October 2023 due to underlying demand and underlying reductions in non -essential spending.

Chris Williamson, Chief Commercial Economist of S&P Global, said: “The first indicators of commercial conditions in 2025 add to the gloom about the economy of the United Kingdom.”

He added: “While the growth of production increased more, the improvement is recently to move the dial of a speedometer that points to an economy that is widely mitigating.”

The economy of the United Kingdom grew only 0.1 percent in November 2024 after the flat line between July and September, according to the National Statistics Office.

The growth is stopped by low public investment, high interest rates and modern commercial confidence after the recent budget.

The companies will observe the meeting of the Monetary Policy Committee of the Bank of England (MPC) on February 6, hoping that another base rate cut is announced.

Thomas Pugh, a RSM UK economist, said that the lowest interest rates “would even more help to stabilize markets,” although he warned that the combination of “weak growth and growing inflation is a nightmare compensation for MPC.”

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